Over the past few weeks, the digital asset Sandbox (SAND) has been facing strong resistance levels, hindering its upward momentum. Both the 20-day and 50-day EMAs have posed significant challenges for buyers, creating a bearish trend in the market.
Moreover, a long-standing trendline has further reinforced these resistance barriers, making it difficult for SAND to break through. As of the latest data, SAND is trading around the $0.25 mark.
Increasing Pressure from SAND Bears
An analysis of the price action unveils a descending triangle formation, with sellers continuously testing the $0.23 support level while driving prices downwards by forming lower highs on the chart.
Typically, this pattern favors bears unless there is a substantial breakout above the resistance levels by the bulls.
The $0.23 support level is a critical threshold for bearish sentiment. A breach below this level could expose SAND to further downside risks, potentially leading to a drop towards the $0.1972 support zone.
To regain bullish momentum, SAND must successfully surpass and sustain above the 20-day and 50-day EMAs. Breaking through these levels could set the stage for a price rally towards the $0.3188 resistance, offering short-term gains.
The MACD indicator continues to demonstrate a bearish momentum, with both the MACD line and the signal line situated below the zero mark, indicating the prevailing downtrend.
Traders, however, should remain vigilant for a potential bullish crossover between these lines, which could signify a weakening selling pressure and a possible reversal towards a bullish trend.
Insights from Derivatives Data
Recent derivatives data reveals a slight uptick in SAND’s trading volume, rising by 26.18% to $39.52 million. Despite this, open interest has decreased by 1.27%, indicating a cautious market sentiment.
The long/short ratios on major exchanges present mixed signals. While Binance shows a heavy skew towards long positions with a ratio of 2.2 (among top trader accounts), OKX reflects a more balanced ratio of 1.44. The overall market ratio hovers near neutrality at 1.004.
SAND’s future trajectory hinges on its ability to break above the 20-day and 50-day EMAs, as well as the long-term trendline resistance. A successful breach of these levels could pave the way for a recovery towards $0.28 and beyond.
Conversely, a failure to maintain the $0.23 support might push SAND into a deeper decline towards $0.19.
Traders are advised to keep an eye on the MACD for early signals of a bullish crossover and monitor derivatives data for shifts in long/short positions.